US Stock Rally Cools: Fitch Ratings Raises Concerns Over Banking Sector

Summer holidays are still on. Liquidity is thin, and we are all getting bored.

The US stock rally has taken a beating over the last few weeks, even with CPI numbers yet again surprised positively, with the year-over-year number coming in at 3.2%, contrary to 3.3% as expected by analysts.

From a price perspective, both the S&P and the Nasdaq look like they are technically rolling over after the S&P valuation came just short of 5% away from reaching the previous all-time high.Predictions by analysts show a mere 39% chance of one more rate hike during this year, reinforced by the Fed’s statement that “inflation is likely to be subdued for some time” following the FOMC meeting last week.

Lastly, Fitch Ratings didn’t provide additional optimism as the rating bureau indicated earlier in the week that it might soon downgrade the credit ratings of several banks, including tier-1 banks such as JP Morgan and Bank of America.

Crypto Calm Before the Storm? Prices Waver Amidst Inactivity

The crypto market remains dull, with BTC taking a dive of almost 5% over the last, with most altcoins performing even worse than that.

Overall, the market continues to trade in the same range as it has done for almost half a year. Typically these prolonged periods of compressed price actions lead to rather violent swings, and for now, that swing looks likely to be to the downside even though a number of indicators are also showing positivity.

Personally, I’m not too interested in doing much in the wake of what is going on right now, as even a retest of the last five months’ low would not mean anything materially different for the ongoing trend, even if it would feel devastating.

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Noteworthy Mentions

• How Blockchain Is Transforming Industries

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Industry Shakers

• Singapore's Monetary Authority has updated its regulations for single-currency stablecoins. The new guidelines, announced on August 15, target non-bank stablecoins linked to the Singapore dollar or major G10 currencies, with a circulation above 5 million Singapore dollars. MAS's goal is to enhance the trustworthiness of stablecoins as a digital-fiat bridge.

• Jacobi Asset Management has spearheaded the introduction of Europe's first Bitcoin exchange-traded fund (ETF), listing it on Euronext Amsterdam. Known as the Jacobi FT Wilshire Bitcoin ETF and trading with the symbol BCOIN, this financial product levies a yearly management fee of 1.5%. It is designed to offer institutional investors an uncomplicated, safe, and clear pathway to Bitcoin, all while conforming to sustainability standards.

• Last week, Coinbase crypto exchange unveiled its innovative Base blockchain, marking a pivotal moment for public enterprises operating personal distributed systems. The Base infrastructure utilizes Optimism's OP Stack technology and functions as a rollup network. Shortly after Coinbase's introduction of the Layer-2 Base platform, Coca-Cola introduced its latest NFT assortment. Enthusiasts have since snapped up NFTs valued at more than 450K on this platform.

• G20 nations are gearing up to potentially implement the first global crypto regulations ahead of September's Leaders' Summit, with support from the FSB and IMF under India's presidency. A jointly-produced "synthesis paper" by the IMF and FSB, expected by the end of August, will explore the worldwide crypto implications, including recommendations from India and other standard-setting entities.

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